For Arab countries yet to fulfil their potential, the UAE is a benchmark



I first came to the UAE in December 1979 as a 14-year-old on a school holiday from England. Despite being Lebanese, I had no clue about the region and when I asked my geography teacher – the obvious choice – he stopped to refill his pipe mumbling something about the Trucial States and went on his way. It only served to confuse me even more.

My father was appointed Middle East Airlines (MEA) manager in Ras Al Khaimah – the most northern, arguably the most unsung and certainly the most beautiful, of the United Arab Emirates. A lot was expected from RAK, as the small but resilient expatriate community called it. An oil-led boom was expected and MEA wanted to get in on the act.

At the time, there was only one flight a week, a short hop after the aircraft landed in Dubai and disgorged all its passengers. I say “all” because every time I flew on to Ras Al Khaimah at least, I was always the only one on-board.

Ras Al Khaimah had few delights back then. The swimming pool at the Ras Al Khaimah Hotel was the social hub in the summer and where I discovered the delights of fresh crayfish. There had been plans to build another hotel on the nearby beach but construction stopped soon after it was obvious there would be no oil. The concrete shell remained, a reminder of false optimism.

Television reception depended on the weather. In the summer, the humidity carried the signal for Dubai 33 up the coast but in the milder winters we had to make do with Ras Al Khaimah TV, which as far as memory serves, aired the local news, an episode of Get Smart and a B-movie before going off the air. A few friends had video recorders and rented bad quality pirated films from a dodgy shop in town.

The highlight of any holiday was a day trip to Dubai, where I would make a beeline for the Al Ghurair centre and spend my allowance on the colourful array of pirate cassettes. That was what Dubai meant. As for Abu Dhabi, where my uncle lived, well that was another few hours down the road and I never went.

The last time I visited the UAE was in the summer of 1985 and I haven’t been back since. In 1992, I moved to Lebanon and heard about the development that had picked up pace. “Oh you’d never recognise it now,” Lebanese expats cooed. “The Al Ghurair Centre? “No, no, no. Now there’s this mall and that mall and that hotel and this hotel” and of course I saw the images of the Burj Al Arab and the Palm. But it was only when I stumbled upon a copy of National Geographic in July 2007 and saw a double spread photo of the Sheikh Zayed motorway that it hit home just how far Dubai has come in such a short space of time. Where once there had been nothing, there was skyscrapers.

Abu Dhabi was also emerging as a global powerhouse. Wealthier, but possessing marginally less bling than Dubai, it has made its name through shrewd high-profile investments in industry, sport and real estate to stamp its international bona fides.

Even good old Ras Al Khaimah got its act together, after a fashion. Tourism has picked up and there are more hotels. In 2000, the government established the Ras Al Khaimah Free Trade Zone, while RAK Airways, a low-cost carrier, was launched in 2006.

Yes, the UAE had the resources, but it did not sit on its laurels. It knew that it had to diversify and it developed a game plan – and if you live in the Arab world long enough you will know that game plans are not naturally built into our DNA. And if by some miracle someone devises one (like the late Rafik Hariri’s Horizon 2000 project for Lebanon), there is no guarantee it will ever reach fruition.

Thus given the vision, focus and commitment required to see a master plan through to its completion, the emergence of the UAE in the last 25 years must be ranked as one of the mightiest economic achievements of our age.

For those Arab states yet to fulfil their potential, the UAE is the obvious benchmark. It has established political stability, developed infrastructure, created a global retail and tourist destination and consolidated financial hub driven by a modern business culture, all the while playing a vital role regionally and on the world stage.

As my geography teacher would also say, “It’s not what you’ve got Karam, it’s how you use it.” A++ for the UAE.

Michael Karam is a freelance writer based in Beirut

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UPI facts

More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions

The biog

Favourite book: You Are the Placebo – Making your mind matter, by Dr Joe Dispenza

Hobby: Running and watching Welsh rugby

Travel destination: Cyprus in the summer

Life goals: To be an aspirational and passionate University educator, enjoy life, be healthy and be the best dad possible.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 
2025 Fifa Club World Cup groups

Group A: Palmeiras, Porto, Al Ahly, Inter Miami.

Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.

Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.

Group D: Flamengo, ES Tunis, Chelsea, Leon.

Group E: River Plate, Urawa, Monterrey, Inter Milan.

Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.

Group G: Manchester City, Wydad, Al Ain, Juventus.

Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.

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Europe’s rearming plan
  • Suspend strict budget rules to allow member countries to step up defence spending
  • Create new "instrument" providing €150 billion of loans to member countries for defence investment
  • Use the existing EU budget to direct more funds towards defence-related investment
  • Engage the bloc's European Investment Bank to drop limits on lending to defence firms
  • Create a savings and investments union to help companies access capital
Saudi Cup race day

Schedule in UAE time

5pm: Mohamed Yousuf Naghi Motors Cup (Turf), 5.35pm: 1351 Cup (T), 6.10pm: Longines Turf Handicap (T), 6.45pm: Obaiya Arabian Classic for Purebred Arabians (Dirt), 7.30pm: Jockey Club Handicap (D), 8.10pm: Samba Saudi Derby (D), 8.50pm: Saudia Sprint (D), 9.40pm: Saudi Cup (D)